Feb 14, 2007—Discover Financial Services, the fourth-largest credit-card organization in the United States, has launched a technology trial to test a new mobile banking and RFID-enabled payment platform in collaboration with handset maker Motorola.

Discover announced, late last year, plans to launch an RFID-based (contactless) payment platform. At the time, the company said the technology would be available in the form of ISO-14443-compliant payment cards and key fobs, as well as in electronic mobile devices using near-field communications (NFC) technology, based on the ISO 18092 air-interface standard (see Discover Rolling Out RFID Payment Platform).

Participants can use phones with Motorola's new M-Wallet platform to check Discover account balances, make RFID-based payments and more.

According to Joby Orlowsky, vice president of marketing for the Discover Network, the credit-card organization has already completed some internal tests involving RFID-enabled payment cards. The trial with Motorola, he says, will represent the firm's first test of NFC technology for RFID-based payments. The ability to make payments, however, is just part of the scope of the trial, which is also an initial trial of Motorola's M-Wallet technology.

M-Wallet is a service Motorola has been developing for a number of years to enable such mobile banking applications as making payments via NFC technology. Other applications include using a mobile phone to check account balances, redeem electronic discount coupons and make person-to-person money transfers. These applications happen through data communications via the cellular phone network, whereas the payments occur through RF transmissions with RFID-enabled payment terminals at stores and restaurants.

All 1,000 participants in the Discover-Motorola trial are Discover employees with Discovery credit-card accounts, located in and around Chicago and Salt Lake City. For the trial, which started in January, the participants have been provided with Motorola's SLVR L7 mobile phone loaded with the M-Wallet software. Only 100 of these phones carry an NFC module (provided by NXP Semiconductors), which is needed to make RFID payment transactions. The other 900 phones will be used to test only M-Wallet applications unrelated to NFC.

According to Orlowsky, the 100 participants given the NFC-enabled phones can use them pay for purchases at any of thousands of in Chicago and Salt Lake City merchants that are equipped with NFC payment terminals able to process payments using Discover contactless devices. However, nondisclosure agreements preclude him from revealing the names of the participating merchants.

Discover hopes the feedback it will gather from the trial participants will help it quantify the benefits M-Wallet would provide to both its cardholders and the merchants accepting contactless payments. "Primarily, we want to validate the value proposition for the constituents," explains Orlowsky. This will involve measuring the speed of the payments made with the Motorola phones, as compared with those made with traditional plastic cards, and polling the participants on their feelings of convenience and security around transactions and the other M-Wallet applications.